War crime suspects who have fled to Britain after being involved in genocide or crimes against humanity dating back to 1991 will face prosecution in UK courts under proposals announced by the justice secretary, Jack Straw yesterday.

He proposes closing a loophole so that prosecutions can go ahead against British nationals and residents accused of genocide, war crimes and crimes against humanity. But the new powers, to be introduced into parliament this autumn, will not open the way to the arrest of any suspected war criminal or genocidaire who sets foot in Britain.

"The prospect of having our courts reaching out to prosecute those who may simply be passing through our borders is neither attractive nor practical. Those not resident in this country could, and should, be prosecuted by jurisdictions where they live, Straw writes in the Guardian.

The existing law allows for war crimes and acts of genocide committed anywhere in the world since 2001 to be prosecuted in a British court if the accused is UK national or legally resident. Straw has decided to backdate the power to prosecute genocide as an "extra-territorial" offence in British courts to 1 January 1991 – the date from which the International Criminal Tribunal on the former Yugoslavia bases its work.

This change in the law opens the way for the prosecution of several Rwandan genocide suspects believed to be in Britain. Amnesty International voiced "grave concern" three years ago over the government's failure to take action against two men living in Britain who the Guardian disclosed were among the top 100 wanted genocide suspects at large in Europe.

Charles Munyaneza, 48, and Célestin Ugirashebuja, 55, local mayors accused of organising genocide in their provinces, were leading ordinary lives, one in Bedford, the other in Essex. At least two others allegedly involved in the Rwandan genocide are believed to be living in Britain.

The Aegis Trust, an anti-genocide group, believes there are at least 18 suspected war criminals living in Britain, from countries including Sri Lanka, Iraq and Sierra Leone.

The trust welcomed the announcement but argued that being present in the UK should be enough to prosecute a war criminal: "Suspects who have been present in the UK since the 90s but not resident include Félicien Kabuga, the alleged financier of the Rwandan genocide, and Chucky Taylor, former head of the anti-terrorist unit in Liberia, who was recently convicted in the US for torture," said Aegis.

But Straw said he believed the change would send a signal that Britain was no longer a haven: "Those who committed genocide or war crimes or crimes against humanity during the 1990s must not escape justice." Amendments will be tabled to the coroners and justice bill when it returns to the House of Lords.

Gordon Brown, speaking at a press conference alongside the Rwandan president, Paul Kagame, said the change delivered a "simple message" to those accused. "Their time is up," he said. "They may have run from the responsibility over the last few years, but they can no longer hide in Britain from the justice that should be meted out to them."